Finding Text
Coronavirus State and Local Fiscal Recovery Funds – Assistance Listing No. 21.027
U.S. Department of Treasury
Missouri Primary Care Association
Criteria or specific requirement – Procurement (2 CFR 200.319 and 2 CFR 200.320)
Condition – The Organization’s internal controls over compliance were not sufficient to ensure the appropriate procurement method was utilized based on the value of the procurement transaction or to ensure procurement transactions were conducted in a manner that provided full and open competition.
Cause – The Organization did not follow its policy when procuring services during the pre-construction phase of a project later funded by federal grants.
Effect or potential effect – A contract for services was entered into during 2022 with estimated fees in excess of the threshold requiring a formal procurement method. The request for proposal did not allow for full and open competition as the Organization did not publicly request proposals or bids and only one proposal was obtained. Services purchased in 2024 under this contract may not have been obtained in the most effective manner.
Questioned costs – Unknown
Context – A sample of one procurement totaling $336,274 was tested out of a population of three procurements. The sample was not, and is not intended to be, statistically valid. The Organization’s procurement records were insufficient in accordance with the Organization’s procurement policy and Uniform Guidance.
Identification as a repeat finding, if applicable – Not a repeat finding
Recommendation – The Organization should educate employees on its procurement policy, which is compliant with Uniform Guidance. The Organization should also implement additional internal controls, such as the creation of a standard form or template for purchase orders, contracts, requests for proposals/bids, cost/price analyses, bid evaluation, etc., to ensure compliance with its procurement policy and that procurement records sufficient to detail the history of each procurement transaction are maintained.
Views of responsible officials and planned corrective actions – This error occurred during fiscal year 2022, when the architect for an upcoming project was chosen. We are in a very rural area, where architects are not easy to come by. For this project, we had decided to utilize a local firm we had a good track record with. We presented it to our board for approval, and it was approved by them at that time so we originally had thought we could justify with having them as a sole source vendor. At the time, the total amount of the project was unknown, and has even changed significantly since that date. However, come to find out, due to the size of the project it should have been bid out. We have revised our procurement policy since this date and have educated all staff on proper procurement procedures.